In-Place Hold feature and user License changes in Office 365

Today we are going to speak about an issue I recently came across, which doesn’t have an easy solution. This is about In-Place Hold feature and license changes made to users, while their mailboxes are included in a Mailbox Search which is also placed on In-Place Hold.

The idea was to remove In-Place Hold from only 1 mailbox, so basically, we had to modify a bit the configuration of the Mailbox Search.

Admin then decides to purchase an Office 365 Enterprise E1 license or another license below E3.

Admin then changes the User A and User B license to E1.

Admin then decides to remove User A, but he receives the below error (incorrect license is the keyword in the error message):

You don't have the correct permissions to place the mailbox "User B" on In-Place Hold because it's outside the scope of mailboxes you can place on hold. One possible reason is the mailbox doesn't have a license for In-Place Hold. To get permissions, contact your administrator.

Note: Using Power Shell to try and fix this issue, will not work either.

This issue is happening due to the fact than whenever you want to remove a Source Mailbox from the search, this is not done individually.

The removal is done for User A, and then all the other Source Mailboxes are re-added.

As User B has E1, it will not be allowed to be added. In-Place Hold feature is available starting E2 license.

Conclusion:

Using the In-Place Hold feature should be well thought before being put into practice, especially if your tenant has mixed licenses that are applied on users (E1, E3, E5 etc.).

Once a mailbox has been put on In-Place Hold, by being included in a Mailbox Search, we should make sure that we do not change its license (from one that has In-Place Hold included as an option, to one which is less pricy, but without the In-Place Hold included).

A possible solution in this whole scenario, when it comes to removing just 1 mailbox from In-Place Hold and the corresponding Mailbox Search, would be to:

Backup the content of the mailbox

Remove the current license that does not have In-Place Hold included

Add back a license that also includes In-Place Hold

Try to remove the mailbox from the In-Place Hold applied on the Mailbox Search

If you have more mailboxes that are included in the search, and for which you changed the license, like you did for that 1 mailbox, then you might want to reach Microsoft Support.